October 10, 2008

Krugman: Economic Crisis needs Global cooperation

Posted: 12:19 PM ET

You may think that things can’t get any worse — but they can, and if nothing is done in the next few days, they will.

Why do we need international cooperation? Because we have a globalized financial system in which a crisis that began with a bubble in Florida condos and California McMansions has caused monetary catastrophe in Iceland. We’re all in this together, and need a shared solution.

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Filed under: Economy • Paul Krugman • Politics

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Bill P   October 10th, 2008 12:30 pm ET

Sometimes I wonder if our real crisis is just ignorances. Due to the fact that they' re dragging their feet on this "crisis"-sitting around pointing fingers and arguing like 2 year olds. While watching those CEO's sitting in front of the Seante explaining themselves with no regret for what they have done. I hear they have broke no laws, yet they have broke America. Down here where I'm from, they call them Conartist. The problem is none of them have to suffer any consequences. Seems they are above the law. They have no morales. Why can't the Government set some examples- seems pretty simple to me. Now is the time change.

Bruce   October 10th, 2008 12:39 pm ET

Now is not the time to panic, but pray. What if all this is happening to get back to basics: God, people, morality and responsibility? If our presidential candidates and their VPs can hush on the name calling and get to the true matters, the american people can make clear decisions in this election – we are intelligent. We are taking "In God We Trust" off our currency/coins and we wonder why our financial system is falling. Our forefathers knew they and our country were great, but acknowledged God is greater. America needs to repent for its greed and loss of integrity one american at a time, but the leaders must be first for the people to see.

Robin Brozovich   October 10th, 2008 2:45 pm ET

I don't really see how this bailout is suppose to help the normal everyday person. By the government buying up bad debt, the banks and financial companies are suppose to ease credit restrictions and such? This is suppose to flow downhill to the everyday working person. How? I don't see it happening. The bank and financial companies are going to keep things tight. Thus the everyday working person is still going to be squeezed until nothing is left. I have a great way to solve the economy crisis. Instead of bailing out the banks and financial companies and then having all the tax payers pay for it in the long run, why not give the money to the people. Think about it. What if all the peoples debts were paid off. Lets say give each tax payer five hundred thousand dollars or one million dollars with a stipulation of paying off all you debts, then getting the balance. Think of how many parts of the whole financial system would be affected. Mortgages paid off, credit cards paid off, student loans paid off, states getting their child support money back..etc The balances left would then be put back in the economy. People would buy a house if they don't have one or put money into their existing home. People would buy new cars. The housing and auto industries being saved. Banks would be saved. This type of plan would also cost a lot less then 700B. How many stimulus checks we issued? Around 130 Million or so I think. The morale of the county would increase. The dollar would even get stronger and such. The debt/credit system needs a reset back to zero or at least close to zero. Its gotten way out of hand.

Retired Military   October 10th, 2008 2:52 pm ET


I was watching CNN today and they talked about how GM was to big to failed. How does anyone determine when a company is to big to fail? Is there some magic number of employees or financial value? This is a global economy. Would other companies come in and buy up the different divisions of GM that are profitable. The banks that are failing are being bought by other banks.

Michael J. Notte   October 10th, 2008 3:03 pm ET

Larry these lies and accusations against Obama,are ridiculous! Please let people know they can go to SALON .COM ; AND GO TO AN ARTICLE BY David Talbot ,( The Palins un-American activities. ) Hell ,the McCain camp wants to get so down and dirty,and lie; then I think the American voters need torealize the truth behind Gov, palin and the "first dudes" involvement with this organization. The A.I.P.(ALASKA INDEPENDENCE PARTY) then so how bold they are,. ..This movement IS TRUELLY SCARY! JOHN McCain and Sara Palin should be ashamed of themselves. thank-you MICHAEL NOTTE; Conneaut, Ohio, ( Go Barack and Joe)

Michael J. Notte   October 10th, 2008 3:07 pm ET

Larry thank-you for having Miichelle Obama on the other nights. What a classy and truthful,,softspoken,articulate,women she is. And what a wonderful First Ldy she's going to be; for this nation..True grace and elegance in the flesh.

D. Collins   October 10th, 2008 3:16 pm ET

I seem to remember that after 9/11, the Bush/Cheney administration going on and on about how it was going to pull the plug on the terrorists by getting them where it would hurt the most–their finances. The administration was going to freeze accounts and halt credit amongst other things.

Is it possible that the brainiacs in the Bush/Cheney administration pulled the wrong plug?

Real talk   October 10th, 2008 5:09 pm ET

Putting Palin on the ticket was the worse thing George Bush (I mean McCain could have done) she is not equipped to do the job. We all know that McCain is kind of old and if anything were to happen to him while in office; how many Americans would feel safe having Palin as President. Not me that’s for sure.

Timber   October 10th, 2008 8:05 pm ET

Hi Larry,

If it looks like a rat, and smells like a rat, chances are it is a rat.

I find it very hard to believe that the recent and very rapid collapse of the global economy is due to sub-prime mortages. Sure there are issues that needed to be corrected, and a free enterprise market would have flushed it out. The sub prime market share is only a small portion of the global economy. Am I the only one who hasn't ruled out the possiblity of a well aimed and executed terrorist cyber attack? Given the fact that global economies communicate solely in a digital environment, a computer virus or capable of hacking could cause widespread havoc. Hopefully someone at the federal govt., G7 or other entity is looking at all possible scenarios and not just reacting to panic. Seems to have terrorist written all over it. Same as 9-11, it was right under our noses and nobody saw it until it was too late.

Nina   October 10th, 2008 9:47 pm ET

I'm glad the Bush Administration was not successful in privatizing social security otherwise those funds would have been part of the meltdown and the Gov't would have looked to the taxpayers to bail them out...

earl thompson   October 12th, 2008 9:05 am ET

Nonsense, all we need is an immediate, substantial increase in the u. s. money supply. The other countries will rationally follow our lead. We will be out of financial trouble as homeowners and financial institutions will be saved; and we will immediately transform our current recessionary trend into an economic boom. Hey Bernanke: Wake up and do the right thing.

Kyra H.   March 7th, 2009 2:37 am ET

I'm amused with how frightful and insecure America is all of sudden. Greedy elites always mess things up, it's pretty ridiculous. And it's funny seeing a bunch of anti-Marxist conservatives scramble about, questioning capitalism since this time it screwed them over. But we shouldn't be complaining, because after all, countries we have exploited for years had always been suffering from the crap end of capitalism while we thrived. It's just funny how the system works. They're all laughing at us I bet.

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